Opinions of the State Council on the Establishment of a Unified Basic Pension System for Urban and Rural Residents

Opinions of the State Council on the Establishment of a Unified Basic Pension System for Urban and Rural Residents

Guo Fa [2014] No.8

February 21, 2014

The people's governments of all provinces, autonomous regions and municipalities directly under the Central Government and all ministries and commissions of the State Council and all institutions directly under the State Council,

According to the spirit of the 18th National Congress of the Communist Party of China and the requirements of the Third Plenary Session of 18th CPC Central Committee regarding the integration of the basic pension systems for urban and rural residents and pursuant to the Social Insurance Law of the People's Republic of China, the State Council has determined, on the basis of summarizing the experience in the pilot areas that implement the new rural social pension system (hereinafter referred to as the "New Rural Pension Insurance") and the social pension system for urban residents (hereinafter referred to as the "Urban Resident Pension Insurance"), to integrate the New Rural Pension Insurance and the Urban Resident Pension Insurance into a unified basic pension system for urban and rural residents (hereinafter referred to as the "pension insurance for urban and rural residents") nationwide. The following opinions are hereby put forth:

Article 1 Guiding Ideology
Hold high the great banner of socialism with Chinese characteristics and follow the guidance of Deng Xiaoping Theory, the important though of Three Represents and the Scientific Outlook on Development to thoroughly implement all policy decisions of the CPC Central Committee and the State Council; fully implement and continuously improve the basic pension system that covers all urban and rural residents to give full play to the important role of social insurance in protecting people's basic livelihood, adjusting social income distribution and promoting the harmonious development of urban and rural economy and society under the guidelines of full coverage, guaranteed basic livelihood, flexibility and sustainability and with enhancing fairness, adapting to liquidity and ensuring sustainability as the focuses.

Article 2 Objects
Adhere to and improve the pattern that combines social pooling with individual accounts, consolidate and expand the financing channel that comprises individual contributions, collective allowance and government subsidies, improve the benefit payment policy that combines basic pension and individual account pension, promote the incentive mechanism for systems such as more pension for longer-term contributions and more pension for more contributions, establish a normal adjustment mechanism for basic pension, improve the service network and elevate the management level to provide the insured residents with convenient and fast services. At the end of the "12th Five-year Plan", the systems of New Rural Pension Insurance and the Urban Resident Pension Insurance will be largely implemented nationwide in a combined way and will be aligned with the basic pension system for employees. By 2020, China will have established a fair, unified and standardized pension system for urban and rural residents, which, in combination with social relief, social welfare and other social security systems, will give full play to the active role of the traditional security methods such as family support to better safeguard the basic livelihood of the elderly in urban and rural areas.

Article 3 Insurance Coverage
Urban and rural residents that are neither staff of state organs and institutions nor covered by the basic pension system for employees with an age of 16 or above (excluding students) may participate in the pension insurance for urban and rural residents at their registered domiciles.

Article 4 Fundraising
The urban and rural residents pension fund consists of the individual contribution, collective allowance and government subsidies.
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